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Estonian footie star done for Norway tax cheat

The captain of the Estonian national football team on Friday got an eight-month suspended sentence in Norway for failing to pay nearly €100,000 ($135,000) in taxes.

Published: 14 June 2014 00:44 CEST

Estonian footie star done for Norway tax cheat

Raio Piiroja (right) complains about a decision when playing for Fredrikstad in 2009. Photo: Tor Erik Schroder/Scanpix

Thirty-four-year-old Raio Piiroja, who is no longer a resident of Norway, pleaded guilty to the charges.

According to the prosecution, Piiroja hid wages earned while playing for the Norwegian football club Fredrikstad between 2004 and 2011 by paying the money to an Estonian company.

"If the law is violated, one must accept his punishment. Now, I accept my punishment and I am ready to close this chapter," said the central defender, cited by the Norwegian broadcaster NRK.

The prosecution had demanded a 10-month suspended sentence, while the defence called for a more lenient suspended sentence of between six and eight months.

All money owed to the Norwegian tax authorities has been fully repaid, according to the defence.

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Why Norway's earnings dropped in 2020 despite steady taxes from individuals

Photo: Giorgio Grani on Unsplash

While the state’s reduced income is linked to the Covid-19 pandemic, and the measures to combat the spread of the virus, individuals last year actually paid more tax than the year before. 0.8 percent, to be precise.

Yet the Norwegian tax revenue amounted to 858 billion kroner, 85.8 billion euro, last year, a 9.1 percent decrease from 2019, according to official figures from Statistics Norway (SSB).

Plummeting oil prices

The main driver of the decline is the reduced income from taxes on petroleum. The industry only paid 28 billion kroner, about 2.8 billion euro, in taxes last year. A staggering 80 percent drop from the 134 billion kroner paid the year before.

The petroleum industry is by far Norway’s largest economic sector. And, like all oil-exporting countries, Norway has been hard-hit by the sudden drop in demand – coupled with a global glut – for petroleum, noted, among others, by the OECD.

The impact of the pandemic on the international petroleum and crude oil market was undeniable when the barrel price plummeted from 45 dollars in March last year, to a record low at under 25 dollars in April. And all through the pandemic it fluctuated below 45 dollars, before eventually making a recovery in December, according to the overview from Business Insider.

Support investments

To help the industry weather the storm, Norway slashed its taxes and fees.

“Oil and gas industry is an important resource for Norway,” said Minister of Finance Jan Tore Sanner in a May press release.

“It is therefore important for the government to contribute to upholding the activity in the oil and gas industry and the suppliers to this industry in order to ensure that they make it through the Covid-19 crisis,” he continued.

The goal was to free up an additional 100 billion kroner, 10 billion euro, for investments.

Increased activity

The approach seems to have been successful. A recent report by the Norwegian Petroleum Directorate (NPD, ‘Oljedirektoratet’), concludes that activity on Norway’s continental shelf was bustling last year, despite the problems plaguing the industry in the rest of the world.

“While 2020 has been an unusual year in many ways,” said Director General Ingrid Sølvberg in NPD in a press release, “investments on the Shelf are at the same level as previous years.”

Fossil-dependent

Not everyone shares the enthusiasm, however.

Member of Parliament Kari Elisabeth Kaski from the Socialist Left Party thinks the investment level may increase Norway’s reliance on the fossil energy sector. This is particularly problematic, she believes, in a time where more resources and attention ought to be directed towards sustainable and green energy solutions.

“The reality is that one has given subsidies of such a magnitude that investments in oil have exceeded expectations,” she told newspaper Aftenposten in January.

“This makes Norway more dependent on oil, an unwise direction for Norway to take in the recovery of this crisis,” she continued.

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